One of the few cases where Adam Smith advocated public provision was that of large-scale infrastructure, and in particular transportation infrastructure, which he saw as a prerequisite for economic growth. His rationale was essentially an institutional one: private finance markets were neither large enough nor sophisticated enough to handle the scale and the long payback period associated with such investments. Ironically, in most developed countries, the modern world sees governments increasingly going to the private financial markets to fund infrastructure investments, either in their entirety or in some form of partnership, because the governments do not have the ability to raise the necessary capital. The sums involved are large. The World Bank estimated in 1995 that airport infrastructure alone would require $350 billion for upgrading and maintenance by 2010, and that was before the additional security systems now needed. Smith’s argument, however, may still have some validity regarding lower-income nations where capital markets are poorly developed, risk is high, and access to international funds can be very expensive.
— Kenneth Button, “Air Transportation Infrastructure in Developing Countries: Privatization and Deregulation,” in Aviation Infrastructure Performance: A Study in Comparative Political Economy, ed. Clifford Winston and Gines de Rus (Washington: Brookings, 2008).